involves less investment because the firm does not require an overseas marketing organization or network. It also involves less risk. International marketing intermediaries bring know-how and services to the relationship, so the seller normally makes fewer mistakes.Joint Venturing – joining with foreign companies to produce or market products or services 4 Types of Joint Ventures 1) Licensing – is a simple way for a manufacturer to enter international marketing. The company enters in to an agreement with the licensee in the foreign markets. Disadvantage – the firm has less control over the licensee than it would over its own operations. 2) Contract Manufacturing – the company contracts with manufacturers in a foreign market to product its product or provide its service. Drawbacks are decreased control over the manufacturing process and loss of potential profits on manufacturing 3) Management contracting – the domestic firms supplies management know-how to a foreign company that supplies the capital. It’s a low risk method of entering a foreign-market and it yields income from the beginning. 4) Joint ownership – consist of one company joining forces with foreign investors to create a local business in which they share joint ownership and control. Drawbacks include partners disagreeing over investment, marketing or other policies. 5) Direct Investment – the development of foreign-based assembly or manufacturing facilities. Advantages - lower costs from cheaper labour - foreign government investment incentives - freight savings - improve image in host country - deeper relationship with government, customers, local suppliers and distributors - full control of the investment and therefore can develop manufacturing and marketing policies that serve its long-term international objectives. 5 describe how firms adapt their marketing programs for international markets. (textbook, pp. 641–649) Standardized global marketing – using the same marketing strategy approached and marketing mix worldwide
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